Models of the economy are pretty useful tools. And simple models are some of he most useful. They help people envision how the world works. They help organize thinking.

For Example, the model that says the potential U.S. economic growth is determined by “population (labor force) growth” plus “productivity” is an elegant model that shows how adding workers, or having them become more productive, leads to more economic growth.

But, event an elegant model can lead people astray when the inputs are misunderstood. As they say, [Click To Continue]